NCRDS STERLING INSTITUE OF

MANAGEMENT STUDIES

RETAIL MANAGEMENT

ASSIGNMENT 4

SUBMITTED BY
OMKAR AVINASH VICHARE
VIKRANT ASHOK PATEL
PAYAL MEHTA

- 37
- 22
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ONLINE RETAILING / E RETAILING IN INDIAN

INTRODUCTION TO ONLINE RETAILING:-

The fact that world is fast dwindling into a universal community for the
reason that of Internet and other communication mediums is not completely
reflective in the Indian context. While developed and fast developing countries
have understood the influence of Internet, India is still ignorant and trying to
deal with up with the technological developments.
The retail industry campaign has been repainted by Internet and the rules of
the game in retailing are fast altering. The western culture has affected each and
every aspect of our Indian Society.
The life is becoming fast not only in metros but also in the normal cities. The
number of nuclear families is increasing and both husband and wife are
working, as they have less time to go to the market for purchasing every now
and then.
Some other reasons like these, say shortage of time, traffic jams, late working
hours, versatility of plastic money and above all the approach of internet at the
door step of whosoever desires it. Online retailers have improved their service
and consumers have found it convenient. There is been transformation in
payment mode as well. From advance payment it is moved to cash on delivery
(COD). Even in case of delivery pattern is changed. From fixed delivery timings
it is moved on to convenient delivery timings at the choice of the customer.
India has opened the doors for foreign direct investment in retail.

 Indian market is dominated by unorganized players but there is potential in

the area of retail players as well. Entry of bigger players such as Big Bazaar,
More etc. to even in the rural areas is paved the way of growth in its sector.
There is been rise in the increase of Indian middle class people due to rapid
economic growth. Though the population of using Internet in India is low in
terms of by and large percentage of total population but, in total numbers it is
very high. This gives enormous opportunities for various ecommerce sites to get
in touch with this segment. The population accessing in India is the age group
from 1845. Irrespective of this fact online retailing forms a meagre 0.08%of the
entire Indian retail markets. Market players have to be more positive,
revolutionizing and pioneering in their approach and offering to make serious
inroads. In the current market, bulk of online sales is in a range of items. This
market in India needs to leap to the next level.

PRESENT SCENARIO OF E - RETAILING IN INDIA:-

Currently the retail industry in India is accelerating. It is not widely accepted

as the way it is accepted in Asian counterparts. India is excited to grow to be a
most important player in the retail market. Since India is a developing nation, it
is still not prepared for it. And they are leaving no stone unturned to become the
best in retail Industry.
Also India with a high on cross culture factor, it allows different companies
bringing in variety of products Targeting different consumer segments.
According to the Global Retail Development Index 2012, India ranks fifth
among the top 30 emerging markets for retail. There are many factors
contributing to the boom in this sector.
Some of them are increased consumerism with the ability to afford luxury
items. Even there is increase in the spending power of Indians. Indians are
travelling abroad and they are exposed to different cultures, their way of living,
their style and thereby more brands. Worldwide retailers eye the Indian market
because in our culture there is lots of give And take for marriages, festivals and
other important events.
Hence its imperative for people to spend on gifts as a part a nd parcel of life
irrespective of caste and creed and economic status. As there is no limitation to
the spending power, Cities like Chandigarh, Coimbatore, Pune, Kolkata,
Ahmadabad, Nagpur, Cochin, Hyderabad etc. has fine market for about all
product or service which offers a good proposal for a brand to penetrate Indian
market.

1.
2.
3.
4.
5.

TRAVELING SECTOR
E- TAILING SECTOR
FINANCIAL SERVICES SECTOR
OTHER SECTORS
DOWNLOADS SECTORS

- 76 %
- 8%
- 8%
6%
2%

RECENT TRENDS IN MARKETING STRATEGIES APPLICABLE

AMONG INDIAN CONSUMER:-

ONLINE SHOPPING:
Currently, the most suitable marketing strategies applicable is internet
marketing because it has been seen that the Indian consumers are buying
products

through

online

for

example

greeting

cards,

clothes,

CDs/VCDs/DVDs, cassettes, books, magazines, medicine and educational

material.
The Popular online shops/companies in India include:

 CELEBRITY INFLUENCE:

This is an important tool which is able to influence Indian consumer buying

behaviour. With the visual media becoming more popular the use of celebrities
in the TV media has increased. Celebrities create headlines. Their activities and
movements are being closely watched and imitated. It is not surprising therefore
that using celebrities in advertisements has become common practice. In India
especially, it is not difficult to look for the reasons as to why companies are
increasingly using celebrities. Consumers like advertisements more if they are
admirers of the celebrities in the advertisements.

QUALITY ORINTED OUTLET:

Indian consumers looking for quality choose expensive brands as they feel that
price is an indicator of quality. However, in the absence of well-known brands
in selected product range, consumers are likely to take cues from wellestablished retail outlets hoping that these outlets carry quality products.
FREEBIES:
Indian consumer buying behaviour is influenced by freebies. Freebies are
consumer products given free as gifts for purchasing selected products above a
certain value. TVs, washing machines, refrigerators, and readymade clothes are
some of the product categories in which freebies are given to Indian consumers.

ECOFRIENDLY PRODUCTS:
The environmental awareness in India has started affecting marketing of
products based upon their eco-friendliness. In general, Indian consumers are
likely to buy environmentally responsible products and packs. The future key
for marketing could be to select more ethical and ecological responsible
products and packaging, which is also convenient for consumers, thus,
balancing environmental concerns with commercial considerations. Consumers
in India are taking lead in prompting manufacturers to adopt technologies to
produce eco-friendly products.

REASON FOR GROWTH OF E RETAILING IN INDIA:

4 Reasons E-Retailing Is Set To Boom in

India
E-Commerce is one of the most exciting spaces for todays global online
community, and Indias young start up economy is along for a ride. In the less
than three months of 2011, Indian VCs have already invested over $50 million
in seven e-commerce companies, a 400 per cent increase over the same period
last year.
However, e-commerce in India has a long road ahead, and e-commerce
infrastructure and best practices are in their infancy. Indias 7 to 9 per cent
Internet penetration lags far behind the 30 to 40 per cent China and Brazil enjoy,
and while Indias estimated 100 million Internet users still comprise the third
largest online population, the total Indian e-commerce market was
approximately 3 per cent of the U.S. market last year ($6.7 billion versus $227.6
billion).
Within these great challenges lie great opportunities, and the maturation of
Indias e-commerce ecosystem is no different. A recent report by the Internet
and Mobile Association of India reveals that Indias e-commerce market is
growing at an average rate of 70 per cent annually, and has grown over 500 per
cent in the past three years alone. Here are four reasons that e-commerce is set
to boom in India, after years of false starts:

1. Critical mass of Internet users: With more than 100

million Internet users, the country is beginning to achieve a critical mass of
users who are familiar with web services. In addition, over the past few years,
relatively sophisticated online travel agents (OTAs), such as Make My Trip
which started turning these initial Web users into Web consumers have
dominated Indian e-commerce. While these OTAs have accounted for up to 80
per cent of Indian e-commerce in the past, industry giants such as eBay and the
new crop of e-trailers expect to participate more heavily in this conversion of
Web users to Web consumers, with an estimated 70 per cent growth in Indian ecommerce for 2011.

2.

Rising

middle

class

with

disposable

income: Throughout Indias short history, the country has been a land of
haves and have-nots. However, with the rise of small and medium
enterprises, foreign direct investment, and Indias own powerful multinational
corporations creating millions of new jobs, a new generation of globally-minded
Indian consumers has been created. These consumers are spread across the
country. Furthermore, access to many global and domestic brands is limited to
major metropolitan regions, such as Delhi, Mumbai, and Bangalore. Therefore,
this growing middle class is increasingly turning to e-commerce as the primary
outlet for sophisticated consumer products and services.

3. Payment gateways & logistics:

One of the largest

challenges to e-commerce in India is the lack of infrastructure to support new

businesses. Logistics companies have been notoriously unreliable, and complex
interstate regulations mean that interstate logistics and paperwork is more like
international customs. Additionally, Indians have an aversion to credit cards
only an estimated 2 per cent of the nation has a credit card. However, the new
breed of domestic logistics companies recognize the importance of reliable
delivery and technology investment, and a number of new payment gateway
companies such as CC Avenue have sprung up to service the growing ecommerce ecosystem. Alternative payment methods such as net banking and
cash on delivery are now mandatory offerings for leading e-commerce
platforms and can drive as much as 75 per cent or more of transactions, and
sophisticated technical integrations make the experience seamless.

4. User Experience:

Of course, the primary driver for e-

commerce anywhere is the user experience. Customers prefer a trusted

relationship with an e-commerce brand, and the conveniences and reliability of
e-commerce businesses have to outweigh the benefits of traditional retail
outlets. Because there have been a relatively small number of successful
consumer Internet companies in India, there has been less competitive pressure
to force implementation of global best practices. However, as the number of ecommerce companies has grown, companies have started to place more
emphasis on investing in the user experience. Best practices that have driven ecommerce globally are now a key focus of successful Internet companies,
including merchandising, customer service, user interface design, and
guaranteed delivery and return policy. In this competitive drive to differentiate
via user experience, the ultimate winner is the Indian online consumer.

GRAPHICAL REPRESENTATON OF GROWTH OF

E- COMMERCE IN INDIA:-

EXPECTED TARGET PREDECTIONS IN ASIAN COUNTRIES

GROWTH OF E-RETAILING WITH RESPECT

TO AGE, ECONOMIC GROWTH, INCOME AND
EDUCATION
E- RETAILING :-

AGE,

ECONOMIC

GROWTH,

INCOME AND EDUCATION :-

1.

India has an internet user base of

1.

Rising standards of living and a

about 250.2 million as of June 2014. The burgeoning, upwardly mobile middle
penetration

of

e-commerce

is low class with high disposable incomes

compared to markets like the United Availability of much wider product

States and the United Kingdom but is range (including long tail and Direct
growing at a much faster rate with a Imports) compared to what is available
large number of new entries.

at brick and mortar retailers.

2.

2.

Unique to India (and potentially to

Busy

lifestyles,

urban

traffic

other developing countries) cash on congestion and lack of time for offline
delivery is a preferred payment method. shopping

Lower prices compared to

India has a vibrant cash economy as a brick and mortar retail driven by
result of which 80% of Indian e- disintermediation and reduced inventory
commerce tends to be Cash on Delivery. and real estate costs Increased usage of
However, COD may harm e-commerce online

classified

sites,

with

more

business in India in the long run and consumer buying and selling secondthere is a need to make a shift towards hand goods Evolution of the online
online payment mechanisms.

marketplace model with sites like

Jabong.com.

3.

India's E-commerce market was

3.

Online Travel constitutes a sizable

worth about $ 3.8 billion in 2009, it portion (87%) of this market today.
went up to $ 12.6 billion in 2013. In Online travel market in India is expected
2013, the e-retail market was worth US$ to grow at a rate of 22% over the next 4
2.3 billion. About 70% of India's e- years and reach Rs. 54,800 Crore ($12.2
commerce market is travel related. India Billion) in size by 2015.
has close to 10 million online shoppers
and is growing at an estimated 30%
CAGR vis--vis a global growth rate of
810%. Electronics and Apparel are the
biggest categories in terms of sales.

4.

Due to increasing demand of e-

4.

Due to this there is business

commerce which is making our life opportunities in Logistics, it helps in

easier and time saving.

increase in employment opportunities.

5.

Educational growth play important

role in the growth of the E-Commerce

sector as people are able to use and
understand the technological changes
and the adaptability becomes easy.

Trust On E-commerce A Big

Question:-

Risk

of Losing Money:

No. There is no risk of losing money unless we buy from the

fake side. We should buy the mobiles from the trusted site so
that there will be no risk of losing money.

Default of product risk: Not at all. There is no risk at all because this are the products
which this online sites buy directly from manufacturer so there
no product risk.

Good Services: Now a days we get delivery of products less than 2 or 3 days
with good packing and without damage to the product within
less time.

Fear of non-delivery of product order: Yes there is fear but it is only when we buy that product from
fake sides.

After sales services and convenient product return

policy: Because of the competition now a days the online sites like
eBay or Flip kart are giving good sales services like when the
product is defective then they immediately return the product
and give new one.

Others experience: After the study and the opinions by the people they are more
convenient to do online shopping. Less time, reduced cost,
discounts etc.